Global reinsurance giant Munich Re has estimated the insurance and reinsurance industry impact from Australian Cyclone Debbie at US $1.4 billion, the highest industry loss estimate seen to-date, while the economic impact is seen as US $2.7 billion.
Munich Re has one of the largest market shares in Australia of any global reinsurer, putting the company in a very good position to offer a relatively accurate estimate of the market loss from this cyclone event.
Category 4 Cyclone Debbie hit the states of Queensland and New South Wales in Australia between March 28th 2017 and early April, with wind gusts recorded as high as 263 km/h, a moderate storm surge along the coast and extreme rainfall, as much as 643 mm within 24 hours, that caused flooding across parts of Southeast Queensland and Northeast New South Wales.
Industry estimates to-date have put the impact of Cyclone Debbie on the insurance and reinsurance sector at around the US $1 billion mark. PERILS AG most recently estimated the impact of the cyclone as AU $1.411 billion (just over US $1.07 billion) while Aon Benfield previously put it at US $970 million.
Munich Re puts Cyclone Debbie as the second-most expensive natural catastrophe event of the first-half of 2017, in the reinsurers latest report on global nat cat losses which we covered earlier today.
Munich Re estimates that total economic losses from Cyclone Debbie were
US$ 2.7 billion and insured losses US$ 1.4 billion, meaning that just over 48% of the events impact was uninsured.
Hermann Pohlchristoph, the Munich Re Board member responsible for Asia-Pacific, commented on the first-half impacts; “In terms of actual loss amounts, Asia and Australia were not as badly hit by natural disasters as they often are.
“The loss pattern of Cyclone Debbie in Australia clearly shows that exposure in certain areas continues to be high and that industry needs to address this issue through improved structural measures and professional insurance cover.”
Reinsurance capital providers, including some ILS fund managers and collateralized reinsurers, are expected to take the lions share of the overall insurance market loss from the impact of cyclone Debbie. Although the impact to ILS players is said to be minimal. Munich Re itself will have taken one of the largest shares of the loss from this cyclone event.